Summary: An exploration of how different safety standards across countries impact the automobile industry. Discusses differences in regulations from turn signals to windshield wipers, and how that impacts production choices and costs in the industry.

Original air date: April 18, 2014

Length: 17 min

Discussion Prompt: Reflecting on what you’ve learned about international trade, production costs & the content of this podcast, discuss what impacts the differential regulations on cars in the U.S. and Europe have on (a) production decisions for the firm, and (b) international trade.

Follow-up Prompt: Using economic thinking, consider the tradeoffs between security and cost in this podcast. The governments/regulators in these countries might say it is worth it for consumers to pay more to get more security. What do you think?

Follow-up Prompt: Considering production costs in the context of firms’ desire to maximize profits, what strategies might firms employ to maximize profits under these conditions of different regulations across countries?